Paying for College with Private Banking: A Smarter, More Efficient Way to Save

Jarrett Luehrsen, Austrian Wealth

If you’re a parent, you probably want to give your kids the best education possible. But have you ever stopped to consider the real cost of that education? I’m not just talking about tuition and fees—those numbers are high enough on their own. I’m talking about the long-term financial impact on your wealth, your retirement, and your future.

College tuition at both public and private institutions has skyrocketed over the past 30 years, with public tuition increasing by over 200% and private tuition by more than 100%, far outpacing inflation and putting immense financial pressure on families.

The reality is that paying for college is more expensive than most families realize. And the scary part? It doesn’t just cost you upfront—it can take a serious toll on your finances for decades to come. But there’s good news: you can take control of how you finance your kids’ education with a strategy that cuts out the banks and puts you in charge.

The Hidden Cost of College

Let’s talk about what really happens when you pay for college, whether you’re using cash or loans. If you’re like most parents, you’ve probably been saving up for years or plan to dip into your savings when the time comes. But here’s the problem: paying for college isn’t just about tuition. There’s a massive opportunity cost that most financial advisors never talk about.

Opportunity cost is what you lose by choosing one financial decision over another. When you pull money out of your savings or take on loans to pay for tuition, you’re not just losing the cash you spent—you’re losing the potential growth of that money over time. What could that money have earned if you had kept it invested? What if it had grown uninterrupted in a way that allowed you to use it without losing control?

That’s where private banking comes in.

Why Private Banking Is the Smartest Way to Fund Education

Imagine having access to your money to pay for your child’s college tuition without depleting your savings or locking yourself into a loan. Private banking lets you do exactly that. Instead of pulling money from your savings or paying high interest rates to a bank, you can borrow against your own assets—keeping your money growing while you use it.

Here’s how it works: You set up a private banking system that stores your wealth in a safe, secure account. Over time, this account grows tax-free. When the time comes to pay for college, you borrow from your account to cover the costs—whether it’s tuition, housing, or other expenses. But unlike traditional loans, when you borrow from your private bank, your money continues to grow. You’re not interrupting the compounding process.

You become your own lender. You can finance your child’s education, pay yourself back, and capture the interest that would normally go to the bank. In short, you’re cutting out the middleman and using the same strategy banks have been using for years to profit off other people’s money.

The Shocking True Cost of College

Let’s break this down with an example. Say your child’s tuition is $40,000 per year, and you plan to pay cash. After four years, you’ve spent $160,000. But that’s not the real cost. If you had kept that $160,000 invested in a private banking system, earning a conservative 5% annually, that money could have grown to over $200,000 by the time your child graduates.

But it doesn’t stop there. If you had left that money in your private bank until retirement age, that $160,000 could have grown to nearly $500,000 or more—depending on how long you let it compound. By simply paying for college upfront, you’ve potentially sacrificed half a million dollars in future wealth.

Using Private Banking to Finance College: A Practical Example

Here’s a smarter way to do it. Instead of pulling $160,000 out of your savings or taking out traditional loans, you borrow from your private banking system. Let’s say you borrow $40,000 per year to cover tuition. That money is available to you at any time because you’re in control. But here’s the key: while you’re using the money, your original cash continues to grow, compounding over time.

Let’s say you pay yourself back at an interest rate you set—just like the bank would. That interest stays in your financial ecosystem, growing your wealth instead of padding the bank’s profits. By the time you’ve paid for four years of college, your account is still growing, and you haven’t lost out on future wealth.

Now imagine using this same system for multiple children. Instead of racking up hundreds of thousands of dollars in opportunity costs, you’re financing your kids’ education while still growing your wealth. And because you’re in control of the loan terms, you’re not locked into high-interest payments to a bank. You’re using the same strategy banks use—on your own terms.

The Long-Term Impact: Retain Your Wealth for Retirement

Here’s the part most parents don’t think about: what happens after college. Without private banking, paying for college can have a devastating long-term effect on your retirement. Let’s say you spend $160,000 on college costs today. If you had left that money invested, it could grow to $500,000 or more by the time you’re 65. That’s money you could use for retirement, for travel, for supporting your family.

But without a private banking strategy, that money is gone—and you’re left with a much smaller retirement fund. In fact, the true cost of sending multiple kids to college could wipe out over $1 million in future wealth. That’s money you’ve worked hard for, but without the right strategy, it disappears.

With private banking, you’re not sacrificing your retirement to pay for education. You’re financing it in a way that grows your wealth, so when retirement comes, your money is still working for you.

Take Control of Your Family’s Financial Future

You don’t have to follow the traditional path of draining savings or taking on high-interest loans to send your kids to college. Private banking gives you a smarter, more efficient way to fund their education—without sacrificing your own financial future. By becoming your own banker, you’re keeping the profits, maintaining control, and ensuring your wealth continues to grow.

If you’re ready to learn how private banking can help you finance your kids’ college without losing out on future wealth, let’s talk. I’ll show you how this strategy can work for your family and how you can take control of your financial future—on your terms.